Nov022017

South Dakota’s three congressional delegates are all aboard with the latest Republican tax reform plan.

Aside from the wealthiest Americans, who would see their individual tax rates maintained at 39.6 percent under a plan unveiled Thursday, U.S. Rep. Kristi Noem said the “once-in-a-generation” reform effort would help reduce rates for lower- and middle-class Americans.

Noem, a House Ways and Means Committee member, spoke in a media call shortly after her committee released the draft bill Thursday morning. The plan would lower the total of individual tax rates from seven to four. Rates were proposed at 12 percent, 25 percent, 35 percent and 39.6 percent. Another bracket would be set at zero percent for married couples making less than $24,000 and single-filers making less than $12,000.

In her initial statement, Noem attempted to isolate the ways she believes this plan would benefit everyday South Dakotans. Noem spoke of a woman she met in a grocery story who asked, “When is it going to get better?” Noem said the coupon-wielding shopper spoke of the economic peril she’s faced, and the congresswoman said the woman’s concerns have remained in her mind since.

It’s this tax reform plan Noem said would benefit folks like the mother she met in Watertown.

“Quite honestly, we need to make our tax code better for families like hers,” Noem said.

The tax reform package would also phase in the repeal of the estate tax, aiming for a full repeal in 2024, and preserve the 401(k) savings option. And as Republicans have promised throughout tax reform talks, the plan would simplify the tax code so a person could file their taxes on a form as small as a postcard.

But the plan isn’t loved by all South Dakotans.

The corporate tax rate would drop drastically under the plan, from 35 percent to 20 percent, a benefit to the wealthy that didn’t jive with the priorities of the South Dakota Democratic Party.

SDDP Executive Director Sam Parkinson called the House Republican bill a “massive tax cut” for the wealthy and big corporations, and said it would end up “blowing a big hole in the deficit.”

“We urge Rep. Kristi Noem and Senators Thune and Rounds to vote against this awful plan, and work with Democrats to develop a tax plan that works for everyone, not just the wealthy and large corporations.”

On Thursday, South Dakota’s longest-tenured congressional delegate also offered input on the House Ways and Means Committee’s reform framework.

U.S. Sen. John Thune, a Republican like Noem, sees the reform effort as a means to “fix” a tax code that hasn’t been altered for decades.

“Through comprehensive tax reform, we will be able to provide Americans with more jobs, fairer taxes and bigger paychecks,” Thune said in a written statement released Thursday. “... I look forward to continuing to work with our colleagues in the House to deliver a final pro-growth tax reform package to President Trump’s desk for his signature.”

And for U.S. Sen. Mike Rounds, it’s about time to overhaul the tax code. By cutting the corporate tax rate, Rounds said, average household income could rise $4,000 per year. If the bill makes it through the House, Rounds said the plan is a good starting point for a Senate response to the proposed legislation.

“We’re really happy to the fact that they’re basically real close to being on time with it, and that allows us the opportunity to actually review it, make recommendations and come up with our modifications, and hopefully make it better than it is already,” Rounds said.